Gold Canyon Announces Updated Resource Estimate for Springpole Gold Project

VANCOUVER, BRITISH COLUMBIA--(Marketwire - Feb. 27, 2012) - Gold Canyon Resources Inc. (TSX VENTURE:GCU)(PINKSHEETS:GDCRF) ("Gold Canyon" or "the Company") is pleased to announce an updated National Instrument 43-101 compliant resource estimate, effective February 27, 2012, for its 100% controlled Springpole Gold Project, located 110 kilometers northeast of the Red Lake, Ontario, Canada. This resource estimate is the first since the Company's original estimate prepared by P & E Mining Consultants Inc. on November 20, 2006 and includes approximately 39,000 metres of drilling completed in 2010-11.

Highlights:

• Indicated mineral resource of 1.22 million ounces of gold and 4.82 million ounces of silver.
• Inferred mineral resource of 2.45 million ounces of gold and 11.58 million ounces of silver.
• Drilling continues at Springpole where Gold Canyon plans an additional 50,000 meters of drilling in 2012.

The updated estimate is summarized below:

"The very positive news announced today is a testament to careful geological modelling, the hard work of project management and staff, and to the tenacity of Gold Canyon's management," states Dr. Quinton Hennigh, technical advisor to, and Director of, Gold Canyon. "Although the large size of this resource is impressive, we feel that the gold and silver grades are an equally important reflection of the high quality of the Springpole Project. This resource gives us a solid foundation upon which we believe we can quickly build significant upside through ongoing drilling in near-surface areas proximal to this resource, along the strike of the Portage Zone to the southeast, and at depth where drilling has recently encountered higher grade mineralization."

Resource Modelling

Mineral resources were estimated on the basis of a gold price of US$1,300/oz and US$15/oz for silver, both considered reasonable economic assumptions by the modeller. In order to establish a reasonable prospect of economic extraction in an open pit context, the resources above were defined within an optimized pit shell with pit walls set at 45 degrees; and estimated recovery of 80% for gold and 60% for silver; and mining costs estimated at US$2.00/tonne, processing costs estimated at US$12.00/tonne and general and administrative costs estimated at US$2.00/tonne. The cut-off grade used of 0.4 grams gold per tonne is considered to be an economically reasonable estimate of breakeven mining costs.

Mineral resources were estimated by ordinary kriging using 3-D Gemcom block modelling software in 10 by 10 by 6 meter blocks. Grade estimates were based on capped, 3 meter composited assay data. Gold capping levels were set at 20 grams per tonne gold for the Portage Zone, 31 grams per tonne gold for the East Extension Zone and 12 grams per tonne gold for the Main Zone. Blocks were classified as indicated mineral resources if at least two drill holes and six composites were found within a 72 by 72 meter search ellipse. All other interpolated blocks were classified as inferred mineral resource.

This resource model includes mineralized material in the Main, East Extension and Portage zones spanning from geologic sections 0+1,150 m in the northwest to 0-150 m in the southeast. Along the axis of the Portage Zone, resource modelling includes mineralized material generally ranging from 240-360 meters below surface.

Mineral resources that are not mineral reserves do not have demonstrated economic viability. The estimate of mineral resources may be materially affected by environmental, permitting, legal, title, taxation, sociopolitical, marketing, or other relevant issues. The quantity and grade of reported inferred resources in this estimation are uncertain in nature and there has been insufficient exploration to define these inferred resources as an indicated or measured mineral resource and it is uncertain if further exploration will result in upgrading them to an indicated or measured mineral resource category. The mineral resources in this news release were estimated using current Canadian Institute of Mining, Metallurgy and Petroleum (CIM) standards, definitions and guidelines.

The Company is preparing a NI 43-101 compliant technical report in respect of the updated resource estimate discussed in this news release and will file the technical report on SEDAR within 45 days of the date this news release was disseminated.

Dr. Gilles Arseneau ("Arseneau") has prepared the Mineral Resource Estimate for the Springpole Gold Project, and is independent of Gold Canyon for purposes of National Instrument 43-101 - Standards of Disclosure for Mineral Projects ("NI 43-101"). Gilles Arseneau (P.Geo.) is a Qualified Person as defined by NI 43-101.

Future Plans

Drilling continues at Springpole where Gold Canyon plans 50,000 meters in 2012. A winter drill program is presently underway with approximately 4,000 meters of diamond core drilling having been completed since January 20, 2012. Two additional drill barges have been delivered across the winter road to the Springpole site bringing the total number of barges to four. Barge drilling is expected to commence following breakup, which is estimated to be sometime in May.

Gold Canyon plans to focus approximately 80% of 2012's planned drilling at increasing the resource along the Portage Zone, including testing near-surface areas that currently have a low density of drilling, deeper areas where higher grade mineralization has been recently discovered (127.5 meters at 3.51 grams per tonne gold in diamond drill hole SP11-106 announced in a news release dated January 26, 2012) and along the southeast corridor where the deposit remains open for expansion. The remaining 20% of drilling will be directed at exploration elsewhere on the property.

Gold Canyon and SRK Consulting (Canada) Inc. have recently initiated work on a preliminary economic assessment (PEA). Completion of this PEA is expected by early quarter four, 2012, and it will be accompanied by an updated NI 43-101 compliant resource estimate that includes some of the aforementioned 2012 drilling.

Quinton Hennigh (Ph.D., P.Geo.) and Gilles Arseneau (Ph.D., P.Geo) are the Qualified Persons pursuant to National Instrument 43-101 responsible for, and have reviewed and approved, the technical information contained in this news release. Dr. Hennigh is a technical adviser to, and Director of, Gold Canyon and Dr. Arseneau is independent of Gold Canyon for purposes of NI 43-101.

About Springpole

Springpole is an alkaline intrusion hosting a gold system that represents a potentially new style of Canadian Archean Shield gold deposit. The Portage Zone is hosted by a trachytic porphyry intrusion displaying polyphase autolithic breccias that host gold mineralization. Other zones, including the East Extension and Main, consist of high-grade veins and pods hosted in diatreme breccias composed of intrusive and country rock fragments. These breccias surround the northwest and northern margins of the Portage Zone. The known mineralized zones underlie a total known area of about 4 square kilometers representing only about 15 percent of the greater alkaline intrusive complex which remains yet to be explored.

Conference Call

A conference call to discuss Gold Canyon and the resource estimate will be held at 9:00 A.M. (EST) on February 28, 2012. Investors are invited to participate by connecting to the call using one of the following dial-in numbers: